How to Hire Your First Employees
How to Hire Your First Employees
Your business is growing, and it's time to hire your first employee. It's an exciting time, yes, but the prospect of wading through stacks of applications and résumés can be daunting if not downright scary.
How do you go about finding a person? How do you vet them? What kind of work do you have to do before you speak to the first person?
Hiring Best Practices
Hiring great employees doesn't have to be a daunting task, but it does pay to follow a sound process. Here are five steps to help you get started.
1. Pre-Job Posting
Before you even look at a résumé or application, you have to make some essential issues to address to set yourself up for success.
- At-Will or Contract: Before you set out to hire, you need to understand the laws of your state. "In an at-will state, an employer or employee may terminate employment for any reason (except an illegal one) or no reason at all," says Bernard Lebedeker of Reid Burman Lebedeker Xenick. All states except Montana are considered at-will.
- Job Description: It may seem like a no-brainer, but before you take in the first résumé, determine exactly what duties must be performed. Do this for two reasons—clarity and pay.
- Clarity: Both you and your applicant must be clear on what you need them to do for you. Put it in writing. You'll refer to this document if the need arises to counsel your employees. The document helps you hire and fire, so to speak. If you've never written a job description before, the U.S. Department of Labor publishes the Occupational Index, which gives an exhaustive, but by no means total, list of job titles and their definitions. The definitions are a guideline; you can tweak them to fit your specific needs.
- Pay: Determine not only how much you'll need to pay in salary or wages, as well as any benefit costs. To find prevailing salary or wage numbers, visit association websites or use online tools like Salary.com, Payscale.com, or Glassdoor.com.
- Classification: Determine whether your new employee will be exempt or nonexempt from earning overtime. The Occupational Index classifies job descriptions. It's important to note that it is the job descriptions that are classified, not the job titles. It doesn't matter what you call someone, what they do determines whether they are exempt or nonexempt. For example, an executive secretary or executive assistant is not a salaried or exempt position, according to the U.S. Department of Labor. It's best to have an attorney review your classifications to ensure compliance with the Fair Labor Standards Act.
- Application: Create a job application to fit the position. While some items are standard—e.g., name, address, phone number, email address, employment history—tweak the application for position types. For example, ask about managerial style and history for an exempt position. And make sure you include your Equal Employment Opportunity (EEO) statement on the forms.
- Employee Handbook: Every employer should have an employee handbook. "If you have more than seven or eight employees, then definitely, you need an employee handbook," Lebedeker says. "Interactions with people at work can become very close and familiar. If one person consistently comes in late and doesn't get into trouble, then the person who's always on time is going to be upset." The employee handbook can spell out work schedules and other expectations as well as explain the EEO statement.
2. Job Posting
To ensure you get the best selection of candidates and to live up to your EEO statement, post your job online and with area job banks, your state job bank (usually the state unemployment office), and even some nontraditional places like area churches and veterans associations. Not everyone has access to the internet, so ensure you aren't unintentionally discriminating against any given group.
In preparing for your interview, review the person's background—on paper. Compare the résumé or application to your job description and stop there. It will be very tempting to look up your potential employee online, but that's actually illegal. Looking at social media prior to an interview could give you protected information like sex, race, and nationality. It is impermissible to have this information at this stage of your decision-making.
"A good businessperson is going to want the best-qualified person, so they should have a list of the qualities they're looking for—as well as experience—during the interview," Lebedeker says. "Keep notes during the interview and keep them with the application and résumé for the required time [one year]." This can protect your company from a discrimination lawsuit should someone in a protected class conclude they weren't hired for a reason such as nationality, race, color, creed, religion, or sex.
Once you've interviewed several candidates and determined who your hire will be, put your offer in writing and send out your rejection letters or emails. Make your offer based not only on prevailing pay but also your prospect's experience. Next, you'll file away all of the rejected applications with their notes for the required time (one year), and create your new employee file, which you will keep for the duration of employment and one year after termination.
Hiring someone doesn't have to be difficult. Hiring your first employee will take the longest because you need to put all of your standard hiring practices in place, but after that, it'll be a breeze.